Chinese law casts shadow on local tourism industry
By Kathryn Chiu,The China PostTAIPEI, Taiwan -- The number of tourists visiting Taiwan from the mainland is expected to record a drop of 40 percent after a new Chinese tourism law takes effect from Oct. 1 and causes previously below market price package rates to surge overnight.
September 6, 2013, 12:02 am TWN
Mainland China's national day celebrations begin around Oct. 1 each year. The semi-annual seven-day national holiday for the period, implemented in 2000, has been termed Golden Week.
However, this year's Golden Week may lose its luster for Taiwan's tourism sector due to the enforcement of China's revised Tourism Law.
Local tourism businesses including tour bus companies, hotels, restaurants and recreation area proprietors are expected to lose 40 percent of mainland Chinese tourists in the fourth quarter from the previous year, a travel agency said.
The new tourism law includes many provisions, the most important of which is Article 35, which will cause previously under-market package rate to surge instantly, a travel agency told the United Evening News.
Article 35 prohibits China's domestic travel agencies from “organizing tourism activities and luring tourists with unreasonably low prices.”
Taiwan's restaurants and shops will also suffer losses as the article bans Chinese travel agencies from “getting illegitimate gains such as rebates by arranging shopping or providing tourism services that requires additional payment.”
Chinese travel agencies also shall not “designate specific shopping places, or provide tourism services that require additional payment,” according to the article.
It is estimated that the effects of the new law will be felt the strongest for three to six months before Taiwan's tourism businesses reposition themselves.
For those companies whose operations are overly dependent on mainland Chinese tourists, the new law might be tolling the death knell.
“However, setting legal curbs on business operations should help deter unfair competition, improve the quality of travel services and smooth the industry's future development,” a travel agency owner told local media.
“With illegal practices being phased out, the market is expected to return to a more healthy track of benign competition,” he said.